Estimation of Capacity Utilisation in Indian Industries: Issues and Challenges

The estimation of capacity utilisation (CU) derives its significance from the fact that, if properly assessed, it may provide a reliable indication of incipient inflationary pressure in an economy. Measurement of CU is not confined to a unique method and can be measured for an economy, industry or plant through the employment of survey method or the use of production data. In India, there is no single official estimate of CU. In this paper an attempt has been made to identify the more suitable method of estimating CU in Indian industries through a comparative analysis of the time series and survey method and a study of the international practices. [W P S (DEPR) : 5 / 2012]. URL:[http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/WPASP070512.pdf].